Developers working to bring Costco to area

Published 5:00 pm, Wednesday, May 28, 2014

(For the Chronicle/Gary Fountain, June 16, 2013) Costco at 3836 Richmond in Houston.

(For the Chronicle/Gary Fountain, June 16, 2013) Costco at 3836 Richmond in Houston.

Photo: Gary Fountain

Developers working to bring Costco to area

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Developers in Midland and Odessa are now working to entice Costco Wholesale Corp. to build a store in the area.

Costco is a membership warehouse club that prides itself in offering the lowest price on a range of brand-name merchandise, including electronics, furniture and food.

The closest store to the area is currently in Lubbock, but multiple sources say a warehouse may arrive in Midland or Odessa soon.

Bobby Burns, Midland Chamber of Commerce president and chief executive officer, said in an e-mail that Midland developers are working to bring a Costco to the Tall City.

At least three additional developers in Odessa are also trying to bring a Costco to the area, said Guy Andrews, director of economic development for the Odessa Chamber of Commerce.

Andrews said he attended an International Council of Shopping Centers conference in Las Vegas last year to meet specifically with a Costco representative.

The meeting was scheduled to last 30 minutes, but Costco had little to no interest in opening a store in Odessa at the time, he said.

“He tried to blow us off, so I just asked him the question: When is the last time you were in Odessa?” Andrews said.

The Costco representative said it had been more than two years since he was in the area and Andrews then explained the rapid growth in the area.

The initial lack of excitement grew to “great interest” after the meeting, which ended up lasting 15 minutes longer than expected, Andrews said.

Dave Messner, Costco’s vice president of real estate, said in an e-mail the company is “active throughout Texas,” but could not comment on individual markets.

“They’d like for it to be somewhere between Midland and Odessa,” Andrews said. “That makes sense for them. One store is probably all they’ll put out here and they know it’ll take both populations to support it.”

While no official plans are set, Andrews said Costco will likely ask for additional incentives to make the move to the area and it’s the larger developers that are more likely to seal the deal.

“You’re not going to get a small developer to attract a Costco,” he said. “They’re gonna go with a big boy.”

Odessa-based ICA Properties Inc. owns the 237 acres where the shopping center is slated to sit.

ICA Properties also owns about 60 percent of all primary business office space in Odessa, including seven of the tallest office buildings, in addition to more than 900,000 square feet of shopping center space -- including Music City Mall -- and other undeveloped land throughout the state, according to the company website.

John Bushman, ICA Properties owner, said the Dorado Center now has two tenants under contract.

The tenants signed a confidentiality agreement with ICA Properties, meaning Bushman could not disclose the names of either business.

He did, however, confirm one business is a “large multi-entertainment company” that’s currently located elsewhere in West Texas, yet not in the Midland and Odessa area.

The second business is a housing developer that plans to build apartments or duplexes within the Dorado Center. That company already has a presence in the area, Bushman said.

ICA Properties is also in “serious discussions” with a third company, which Bushman said is a large national retailer.

Bushman said he would not be able to disclose the specific names of any potential tenant until each respective company pulls a building permit. That could happen before the end of the year, he said, but no specific timeline has been set.

The Dorado Center could potentially house more than 25 separate buildings, Bushman estimated, and ICA Properties is actively trying to attract as many national retailers as possible that are not currently in the area.

“The more amenities we can get and offer you, the more likely you are to stay,” Bushman said.